Group

Year 2016

Events

Swiss CEAMS-CE Asset Management, along with its Baltic partners, announced the next nominees for the Corporate Excellence Award. AS Harju Elekter was recognised as the best listed company in Estonia while being the third in the overall Baltic assessment. It was recognised thanks to the continued expansion in Northern Europe, conservative balance sheet, as well as a stable and experienced management team.

Positive recognition was awarded also to the Group's Finnish company Oy Finnkumu, who reached high, 2nd ranking on the list of the Entrepreneurs of South Ostrobothnia.

The AGM of PKC Group Oyj, which gathered on 4 April 2016, decided to pay dividends in the amount of 0.70 euros per share. Dividends were transferred to the shareholders’ bank accounts on 15 April 2016. AS Harju Elekter owns 1,094,641 shares. The dividend income of 766 thousand euros is reflected in the profit of Q2 2016. The 15% income tax withheld from the dividends in Finland comprised 115 thousand euros.

At its 5 April 2016 meeting, the Supervisory Board of AS Harju Elekter decided to merge the metal factories of the Group’s Estonian subsidiaries, consolidating the sheet metal processing resources, capability and know-how of the entire Group into AS Harju Elekter Teletehnika. The outcome of restructuring is economy in terms of manufacturing as well as labour costs. After the changes, AS Harju Elekter Teletehnika will focus on the manufacturing of sheet metal products and details for the electrical engineering and telecommunications sector. Restructuring was completed at the end of Q3.

AS Harju Elekter granted a loan of 660 thousand euros to Skeleton Technologies Group OÜ. In Q3, an additional round of funding and involvement of investors was arranged and the loan was converted into equity of Skeleton Technologies Group OÜ.

On 14 October 2016, AS Harju Elekter bought the real estate company Kiinteistö Oy Uutvallinkulma. Following the transaction, it will bear the name of Harju Elekter Kiinteistöt Oy. The contract price was 518 thousand euros. The company leases 2,470 sq m of production premises to the Group’s Finnish company, Finnkumu Oy. This activity is consistent with the policy of the Group, whereby any production premises used by companies in the Group are owned by the Group.

On 21 October 2016, in Allika Industrial Park, located on the city limits of Tallinn, the cornerstone was laid for two important buildings: HE production and storage facilities and the production and storage building of Stera Technologies Oy – the commercial producer of mechanical and electromechanical devices and components. Prior to that, in April 2016, a preliminary contract was concluded with Stera Technologies Oy for the construction and subsequent leasing of production facilities for the company and procurement conducted to identify a project manager, with “Ehitusfirma Rand and Tuulberg AS” qualifying. The investment volume is 8.2 million euros, which will be covered from own funds and a bank loan. For this purpose, loan agreements in a total amount of 7 million euros, was signed with Swedbank AS. First stage will be ready for delivery to the tenants in the first half of 2017.

Three important substation sales agreements were concluded in Q4 2016 and in Q1 2017, following the reporting date. The most important of these are the agreement signed with Finland’s largest distribution network company, Caruna, on 19 December 2016, and the two order letters received from Konecranes, on 10 January 2017, for delivering special-purpose substations to the United States. As a result of the new orders, the production of substations in the Estonian and Finnish plants of the Group will increase from the current 1,100 substations to 2,500 substations per a year.

To ensure smooth fulfilment of the order volumes, it was decided in Q4 2016 to transfer the operations of AS Harju Elekter Elektrotehnika to new production halls – being vacated by AS PKC Eesti – in the Keila Industrial Park. The project will be implemented during Q1–Q3 of 2017.

The Group’s subsidiaries are actively participated in the professional fairs in Estonia and Finland: trade fair Energia 2016 in Tampere, which is specialised to energy production, transmission, distribution and accumulation; in SLO autumn fair as well as in the building fair Estbuild in Tallinn.